+ All Categories
Home > Documents > Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point...

Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point...

Date post: 23-Mar-2020
Category:
Upload: others
View: 0 times
Download: 0 times
Share this document with a friend
28
Q3 2013 Earnings Call October 23, 2013
Transcript
Page 1: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 2013 Earnings Call

October 23, 2013

Page 2: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

2

We are making some forward looking statements today that use words like “outlook” or “target” or similar predictive words. Such forward looking statements involve risks and uncertainties detailed in our recent periodic reports as filed in accordance with the Securities and Exchange Act of 1934. These risks and uncertainties may cause actual results to differ materially from our statements today.

www.tupperwarebrands.com

Forward Looking Statements

Page 3: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

3

Record Sales +6% local currency

Adjusted EPS of $1.00, up 5% and 16% in local currency

Strong sales across emerging markets • Emerging markets drove strong growth ,+13% (69% of sales)

• Challenges in some developed markets, -8% (31% of sales)

Strong YTD Cash Flow* of $92M, $21M ahead of last year

Returned $132M to shareholders via $32M in dividends and $100M/1.21M shares repurchased

*Cash from operating activities net of investing activities

Q3 2013 Highlights

Page 4: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

2013 Balanced Global Portfolio

4

Europe, 25%

Asia Pacific, 34%

TW North America, 13%

Beauty North America, 12%

South America, 16%

Q3 Segment Sales as % of Total

Europe, 29%

Asia Pacific, 32%

TW North America, 13%

Beauty North America, 12%

South America, 14%

Q3 YTD Segment Sales as % of Total

Page 5: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Brand AND Channel

5

Demonstrator

Unit Manager

Team Leader

Distributor

2.8 million Sales Force

Page 6: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Increased Local Currency Sales Despite Lower Active Sales Force

6

Q3 2013

-6%

-4%

-2%

0%

2%

4%

6%

8%

Decrease inActive Sales

Force

Change inCalculation

Methodology

Mix Productivity Sales Increasein Local

Currency

+3pp

+2pp

+6%

-5%

+6pp

2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a weekly rather than monthly basis

Positive 6 point impact from mix shifts, primarily away from Fuller Mexico that has a lower-than-average order size

Positive 3 point impact from productivity increases in individual markets: Significant price increases in South

America Switch from beauty to more

housewares products in Argentina Improved productivity in Asia, most

significantly in China and Indonesia

Page 7: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Total Company Sales +6% LC

7

Q3 2013 (local currency)

Brazil +36%

Indonesia +31%

Venezuela +63% Malaysia/

Singapore +10%

Turkey +34%

India +3%

TW Mexico +4%

China +23%

Established Markets 31% of Sales -8% vs. 2012

Emerging Markets 69% of Sales

+13% vs. 2012

Germany -20% France

-13%

TW S. Africa -11%

TW U.S./Canada even

BeautiControl -20%

Fuller Mexico -11%

Argentina +39%

Italy +12%

Page 8: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Financial Highlights

8

Page 9: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

$0.83

$0.95 $1.00

$-

$0.20

$0.40

$0.60

$0.80

$1.00

$1.20

2011 2012 2013

GAAP EPS EPS Excluding Items*

Earnings Per Share

9 * GAAP to non-GAAP reconciliation provided in Appendix

(diluted)

Q3 Adjusted EPS Roll-Forward

Q3 2013

Includes Intangible Asset Impairment

$0.95 ($0.09)

($0.03)

$0.09

$0.07 $0.01

$1.00

$0.80

$0.85

$0.90

$0.95

$1.00

$1.05

2012 FX Int Exp Ops ShareImpact

Tax Rate 2013

Page 10: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Outlook

Q4 2013 Full-year 2013

USD Sales +2 – 4% +4%

GAAP EPS $1.75 - $1.80 $5.17 - $5.22

GAAP Pre-tax ROS 16.4 – 16.6% 13.6 %

Local Currency Sales +5 – 7% +6 - 7%

EPS, excluding items* $1.83 - $1.88 $5.45 - $5.50

Pre-tax ROS, excluding items 17.3 – 17.4% 14.3%

FX Impact on EPS comparison, excluding items

($0.06) ($0.19)

10

* GAAP to non-GAAP reconciliation provided in Appendix

Page 11: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Uses of Cash

11

Dividends

Targeted at 50% of Prior Full Year Diluted EPS

Without Items

Share Repurchases

• $75M in Q4 2013

• 2014 Share Repurchase Target to be Announced

in January

Invest in the business

Page 12: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Cash Flow

($50)

$0

$50

$100

$150

$200

$250

$300

2007 2008 2009 2010 2011 2012 2013*

Full Year Cash Flow Q3 YTD Cash Flow GAAP Net Income

GAAP Net Inc. includes impact of non-cash purchase accounting

asset impairment charges

* Full-year cash flow and GAAP net income shown at high end of guidance range provided on October 23, 2013.

Large VAT & FX hedge

contract payments

12

(operating net of investing as reported)

Page 13: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

13

Brazil Overview

Page 14: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Market Facts

14

• Sales +36% in local currency in full-year 2012 and +30% YTD 2013

• 200,000+ Sales Force sell both Tupperware and Beauty

• Selling Method: mainly one-on-one • Opportunity for productivity via

party training • Mega Distributors fulfill

non-stocking Distributors’ product needs

• Population of 190M with a third in the middle class*

• From 2000 to 2010, the share of households in the middle class grew from 24% to 29%**

• By 2020, 37% of the 60 million households will be middle class**

• Retail spending increasing at rapid rate

• Looking for premium quality products and getting familiar with international brands

*Source: “In Brazil, an Emergent Middle Class Takes Off,” The World Bank. Web. November 13, 2012

**Source: “Redefining Brazil’s Emerging Middle Class ,” BCG Perspectives. Web. July 4, 2013

The Facts Performance & The Model

Page 15: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Country Structure

Sales Office in Sao Paulo

20 Mega Distributors

Market Coverage

58 Distributors

58 Distributors

118 Team Leaders

8,000 Unit Managers

200,000+ Total Sales Force

Plant in Rio de Janeiro

Plant Sales Office

Page 16: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Brazilian Business Model

MEGA Distributors

The key factor of the success

Splitting of tasks and responsibilities

Responsible for

BUSINESS MANAGEMENT providing good quality

SERVICES TO THE SALES FORCE

Commission Distributors

100% Focused on

Sales Force Development (training, assemblies, recruiting, etc)

and

Sales Force Development (training, assemblies, recruiting, etc)

Page 17: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Commission Distributors

Builds Sales Organization

• Trains Sales Force

• Conducts Weekly Meetings

• Leadership Development Focus

Page 18: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Mega Distributors

Builds Sales Organization (like a commission distributor)

Services the Sales Force • Holds and manages

inventory • Processes orders and

collects on behalf of Commission Distributors

Page 19: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

19

Q & A

Page 20: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

20

Quality management teams around the world

Premium brands and products

Emerging markets

• Growth of middle class

• Penetration of under and unserved geographies

Established markets

• Execute better and more consistently

• Significant white space to drive growth

Grow our 2.8M sales force

Confidently Moving Forward

Page 21: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Appendix

Page 22: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Appendix: Non-GAAP Financial Measures Reconciliation

2011 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013* 2013*

Net Income (GAAP) $218.3 $193.0 $58.2 $76.3 $49.9 $92.5 $276.9

Adjustments:

Gains on disposal of assets including insurance recoveries (3.8) (7.9) (0.2) (0.8) (1.1)

Re-engineering and other restructuring costs 9.6 22.1 2.2 2.2 2.7 3.3 10.4

Impact of Venezuelan bolivar devaluation on balance sheet positions 3.9 0.3 4.2

Swap impairment and debt cost write-off 19.8

Acquired intangible asset amortization 2.9 2.1 0.3 0.3 1.2 2.9 4.8

Purchase accounting intangibles and goodwill impairment 36.1 76.9

Income tax impact of adjustments (9.6) (4.8) (0.2) (0.7) (0.5) (2.1) (3.5)

Net Income (Adjusted) $273.3 $281.4 $64.4 $78.2 $52.5 $96.6 $291.7

* High end of guidance rage

22

Page 23: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 Segment Sales Local Currency

23

Q3 2013 Sales, +6% YTD 2013 Sales, +7%

Prior year amounts translated at current year foreign exchange rates. See appendix for U.S. dollar information.

$146.9

$205.1

$80.6 $73.8

$96.7

$-

$50.0

$100.0

$150.0

$200.0

$250.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

SouthAmerica

Q3 2011 Q3 2012 Q3 2013

$564.3

$614.5

$263.1 $241.2

$271.4

$-

$100.0

$200.0

$300.0

$400.0

$500.0

$600.0

$700.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

SouthAmerica

YTD 2011 YTD 2012 YTD 2013

Page 24: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 Segment Sales Reported

24

Q3 2013 sales, +1% YTD 2013 Sales, +4%

On a Reported basis

$146.9

$205.1

$80.6 $73.8

$96.7

$-

$50.0

$100.0

$150.0

$200.0

$250.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

SouthAmerica

Q3 2011 Q3 2012 Q3 2013

$564.3

$614.5

$263.1 $241.2

$271.4

$-

$100.0

$200.0

$300.0

$400.0

$500.0

$600.0

$700.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

SouthAmerica

YTD 2011 YTD 2012 YTD 2013

Page 25: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 Emerging Market Sales By Segment Local Currency

25

Q3 2013 Emerging Market Sales +13%

Emerging/Established % Q3 2013 Emerging Market Sales, 69% of Total

Prior year amounts translated at current year foreign exchange rates See appendix for U.S. dollar information.

$58.5

$167.6

$39.5

$53.4

$96.7

$-

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

$180.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

South America

Q3 2011 Q3 2012 Q3 2013

40%

82%

49%

72%

100%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

South America

Emerging Established

Page 26: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 Emerging Market Sales By Segment Reported

26

Q3 2013 Emerging Market Sales, +7%

Emerging/Established %

On a reported basis

$58.5

$167.6

$39.5

$53.4

$96.7

$-

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

$180.0

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

South America

Q3 2011 Q3 2012 Q3 2013

40%

82%

49%

72%

100%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Europe Asia Pacific TW NorthAmerica

Beauty NorthAmerica

South America

Emerging Established

Page 27: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

* As of October 23, 2013. Specific guidance for 2014 to be provided in January 2014 fourth quarter 2013 earnings release.

Double Digit EPS Growth driven by:

• Local Currency Sales: +6% to 8% • Emerging markets about 10%

• Established markets low single digit

• Pre-Tax ROS, excluding items: 50 bps

improvement per year into the mid- to high-teens

• Share repurchases

Long Range Outlook*

27

Page 28: Q3 2013 Earnings Call October 23, 2013 - Tupperware/media/Files/T/... · 2016-01-05 · 2 point impact from Q3 2012 change by Tupperware U.S. and Canada to measuring activity on a

Q3 2013 Earnings Call

October 23, 2013


Recommended